Earning interest on your savings account is a thing of the past, when your money actually worked for you and not against you. We have to be at peace that those days of interest are gone. Or not…?
Bitvavo offers an alternative to saving in the form of crypto staking. We’ll take a closer look at what this means.
Table of Contents
What is staking on Bitvavo?
You stake your cryptocurrency on Bitvavo, when you dedicate cryptocurrency to aid its network and receive rewards in return.
Staking is only possible for cryptocurrencies using the Proof of Stake – POS algorithm. Where it is used to run the blockchain safely and smoothly.
How to stake on Bitvavo?
You can enable ‘staking‘ in the settings of your Bitvavo account. Important to note here is that you can still sell your crypto when ‘staking’ is on.
Your ‘staked’ cryptocurrency on Bitvavo will not be locked, in comparison to some exchanges.
Note that the red ‘S’ appearing behind the coin on the exchange display, states that ‘staking’ is on.
What are the staking options on Bitvavo?
The broker offers two different staking options; off-chain and on-chain. The difference between the two is that off-chain staking allows you to earn rewards by making your crypto currencies available on your Bitvavo account.
The on-chain staking services offers the opportunity to actively contribute to approving transactions. Anyone with a minimum of the selected cryptocurrency can validate transactions and will be rewarded for doing so.
Which coins can you stake on Bitvavo?
At the time of writing, you can earn passively on 17 different cryptocurrencies, which can be staked on Bitvavo.
Check out the table below to review which cryptocurrency you can stake on the Dutch broker.
| Crypto Asset | Interest (p.a.) |
| ICON – ICX | 7.50% |
| Dai- DAI | 6.10% |
| Tether – USDT | 6.10% |
| USD Coin – USDC | 6.10% |
| Waves – WAVES | 5.50% |
| Cardano – ADA | 5.00% |
| Ark -ARK | 1.07% |
| Litecoin – LTC | 1.04% |
| Tron – TRX | 1.03% |
| Bitcoin Cash – BCH | 1.02% |
| Ethereum – ETH | 1.01% |
| Bitcoin – BTC | 0.77% |
| Tezos – XTZ | 0.66% |
| Neo – NEO | 0.52% |
| Ontology – ONT | 0.51% |
| Chainlink – LINK | 0.49% |
| VeChain Thor – VET | 0.49% |
What are the staking percentages on Bitvavo?
You will receive a certain percentage of the staking rewards dedicated to each cryptocurrency you have in your Bitvavo account.
In the table above we’ve listed all annual interests and see that the highest rate is 7,50% for staking ICON – ICX. Followed by the stablecoins that have the second best staking percentages.
Can you stake Bitcoin and Ethereum on Bitvavo?
Since staking only applies to Proof of Stake – POS protocol cryptocurrencies, it’s rather strange that you can earn on Bitcoin and Ethereum, which both have the Proof Of Work – POW protocol.
This is because you can’t stake Bitcoin or Ethereum, but you can make it available for lending to third parties and thus providing liquidity.
Bitvavo rewards users who lend their Bitcoin and Ethereum an annual interest rate of 1%. This option is most suitable for individuals who are in it for the long term and keep their crypto holdings on an exchange (which is not recommended).
When will you receive staking rewards?
Your staking rewards will be received in the form of the staked cryptocurrency and will be added automatically every monday. Your staking rewards can and will be used as staking collateral. Check out our APY page for more and in detail explanation.
How are the staking rates calculated on Bitvavo?
Bitvavo’s staking rewards are shown in percentages. The fees are calculated based on two factors. Firstly, by the current percentage indicated in your account and secondly, by looking at the number of the market value of the cryptocurrency.
How to stake stablecoins on Bitvavo?
Stablecoins, as the name suggests, are coins whose prices remain stable. They can be a safe haven in times of volatility and can be used as a strategy to hedge against price fluctuations.
Previously, you could only get staking rewards for the most well-known coins, however, the following stablecoins have been added;
- USD Coin – USDC
- Tether – USDT
- Dai- DAI
By staking stablecoins you can earn up to 6,1% APY.
What are the risks of staking on Bitvavo?
If you enable Bitvavo staking, remember the following; Bitvavo is not a bank and is not regulated in the same way a bank or similar banking institution is.
Staking is not part of any national or European deposit guarantee scheme and is not insured in any way. Although Bitvavo launched an extra account guarantee scheme that reimburses up to 100.000 euro when your account gets hacked, there are still no guarantees in life…
Some Staking Tips
Volatility: Volatility is a feature of crypto. Not a bug. Be aware that high staking rates do not mean you will earn it.
For example, if you stake a crypto with an interest of 5% and the underlying value of that crypto falls by 20%, it will take more than 3 years before you will earn back the initial amount. Be aware that crypto can fluctuate with regularity sometimes 20% in a day.
Stablecoin: To escape these price fluctuations we recommend you to limit staking to stable coins (USDT, USDC and DAI).
Variable interest: The staking rate is variable and thus can change over time. It will depend on market conditions, supply and demand.
Choosing cryptocurrency for staking: When choosing cryptocurrency to stake, it is best to pay attention to the fundamental analysis. Also try to estimate what it will do in the long run. Be aware of where you are in the market cycle before thinking long term.
What are the pros and cons of staking on Bitvavo
Staking can provide an additional interest on your cryptocurrency. Although you have to consider some pros and cons of staking.
Pros
- Contributing to the operation of your favorite blockchain
- Completely passive
- Long term holding will be rewarded by staking profits
Cons
- Unable to to live off your passive income unless you stake whale-size amounts
- Counterparty risk: If Bitvavo goes down, your cryptocurrency will go down with it
